Italy: Amundi SGR SpA Seconda Pensione Fondo Pensione Aperto
•Invested assets: €291,700 (Mar 2011)
The supplementary pension fund of Amundi Asset Management is a defined contribution plan, founded in 1999. Subscription is voluntary and open to employees of Amundi and other individuals, independent of profession.
Members can choose between three forms of contributions into their pension account: their trattamento di fine rapporto (TFR) only, additional, personal contributions and employer contributions subject to collective agreements signed by employer and employee representatives. Members who subscribe to the plan by contributing their TFR are obliged to pay it in full to the scheme, while individual members can choose their level of annual voluntary contributions, benefiting from tax relief of up to €5,164.57.
Members can choose from six investment lines, including one capital guaranteed strategy, and are able to switch investment lines annually for free. They can also select one of three lifestyle programmes, which automatically reduces their investment risk when they approach retirement.
The scheme has an active management approach, with the main sources of value being asset/sector allocation and stockpicking.
"Taking many small and calculated risks is better in terms of risk/reward than concentrating only on one approach, such as asset allocation," says Stefano Castoldi, manager of the pension fund. "The strategic asset allocation is relative to the benchmark of each line. At the end of April 2010, the funds were overweight equity in Europe and Asia, overweight corporate bonds and foreign exchange in euro but underweight in duration. At present, we are in the process of gradually reducing the overweight in equity."
The benchmarks of the investment lines are heavily tilted towards European equity and towards Italian bonds.
The pension fund manages all its assets directly and in-house. It has full access to all of Amundi Group's expertise, such as strategy, macroeconomic analysis and equity and credit analysis, regardless of location.
Due to restrictions set by decree 703/96, the pension fund has to adhere to investment limits with regard to currency, liquidity, shares of funds, derivatives, equities and bonds not traded in the European Union, US, Canadian and Japanese markets or issued by non-OECD countries.
"Compared to other European countries, such as UK, where supplementary pensions benefit from being of equal status to social security, the Italian supplementary pension system is fundamentally backward-looking," says Castoldi. "Despite the substantial boost following the introduction of decree 252/2005, changing demographics and the pressing problem of the sustainability of the state's balance sheet make a legislative intervention more necessary. The aim should be to make supplementary schemes an indispensable instrument in providing a pension. Another great challenge is the awareness and education of citizens in respect of pensions."